at the intersection of brands, media and culture

The Death of the Retail Brand

In advertising, Branding, Brands, communications, market research, marketing, research, strategy, trends on January 16, 2008 at 12:23 pm

December retail figures are out and it is a reminder of the dismal state of retail brands. Gap, Inc. -6%, Kohl’s -11.4% Macy’s -8%, Target – 5%, etc. There are a few bright spots but even then, they aren’t very bright, perhaps it is the florescent lights.

Adage online points to how taglines aren’t working as hard as they should be and clearly differentiating the stores. And they have a point, but the point that I take away is that Adage has never been to a retail store! The fact that taglines are interchangable is not nearly as important as the fact that the stores themselves are interchangeable. They are all the same. Sure some have slightly different merchandise, Target did a nice job with their design positioning but they also just lost superstar designer Issac Mizrahi to Liz Claiborne.

The big stores all have the same facade with a different logo. They organize their merchandise the same, display it the same– wait a minute, the merchandise is the same too. Everything’s the same! Same bad lighting, same bad service, same linoleum and fake wood floors.

I’ve worked with retail brands long enough (Gap, Wal-Mart, Levi’s) to know that these stores and brands are up against tough competition. They have to keep their traffic numbers up, they have to keep the average ticket up, they are judged month after month by the stock market against same store sales for the year prior, but…can’t they still create a point of view?

Urban Outfitters and Anthopologie have done a great job selling differentiated products in differentiated environments. But they are so small, my clients would scream, show us a big retailer that can do that! Barney’s is getting bigger without abandoning their strong brand message. Saturn car dealerships used to be like that, though I admit I haven’t been in one lately. J. Crew is getting a whole lot better with Mickey Drexler at the helm.

You may notice a trend here: many of the brands that are doing a decent-to-good job differentiating themselves are challenger brands competing against bigger incumbents. The problem is that in today’s climate, no one should be thinking of themselves as an incumbent. Everyone is suffering and the brand that still has the cash to invest in their brand and their store spaces has a better chance at weathering this storm and making it through to the other side in one piece. It’s time to stop putting lipstick on the pig with glitzy ad campaigns and time to get to work on your brands, what they stand for, and how they manifest themselves in retail.

  1. I agree that brands are becoming blurred, especially online. I wonder how much gift cards have to do with the December figures. Gift cards are not reflected in the sales figures until they’re redeemed, and often times many are not redeemed at all. I have a feeling January may include December gift card sales.

  2. Yeah, gift cards may help them out but there is too much bad news there to be made up for by gift cards alone. I’d also posit that online only retailers seemed to do pretty well, Amazon especially. I’d certainly pay the shipping in order to avoid the lines, mess and bad store environments.

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